Procure to Pay
Control Purchasing Costs by Enforcing Contract Compliance!
As the economy picks itself back up off the floor, many companies and government agencies are turning toward more structured processes and tools to help them control maverick spending.
Budgets are tightening and more diligent approval processes are driving many toward stricter guidelines when it comes to supplies and services. Managing operational budgets through spend management and contract compliance will continue to help control purchasing costs across the enterprise.
Executive management is repeatedly tasking the organization to cut costs in order to save jobs and continually looking to the purchasing director for new ways in controlling discretionary spend and driving the enterprise toward global sourced contracts. Unfortunately, these same purchasing directors are losing staff and are tasked to work more efficiently with less people. This can be very difficult to accomplish without the right tools in place.
As part of this effort, the organization must put more accountability on the departmental managers to ensure their employees are adhering to these new guidelines. With procurement tools in place, contracts can be disseminated easily to the organization as a single entry point for most, If not all, purchase requisitions.
With advances in internet technology, online bidding tools are now becoming more accepted and utilized to replace the old bid in the mail process. This type of solution allows online contracts to be created in a compatible procurement tool to present to the entire enterprise. If integration is in place, this can be accomplished with little human intervention, once the contract awards have been completed.
In summary, purchasing managers and their respective management teams should look at procurement and sourcing tools to help control purchasing costs. Strategically, these costs are easier to contain if the organization is able to seamlessly convert awarded bids to online contract portals and enforce accountability at the departmental level.
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